The UK grew rich by looting the world; now it launders billions for other looters

The British empire was a globe-spanning criminal enterprise that produced vast riches for England (and, to a lesser extent, Scotland and Wales) by stealing the lands of others while slaughtering and enslaving them; today the empire is in decline and the UK is no longer reliant on direct looting.

Instead, the UK and its former colonies have become the world's most prolific money-laundry for other looters, servicing criminal oligarchs who steal from their own countries. The latest Corporate Tax Haven Index from the Tax Justice Network (previously) puts the UK and its overseas possessions firmly in the lead in the global money-laundry league tables.

The story is complex: many of the former colonies (now euphemistically termed 'overseas territories' or 'dependencies') were deliberately set up as financial secrecy havens during the decolonization process, a maneuver that provided British elites with a convenient way to hide their wealth from British authorities while creating (some) jobs on these 'treasure islands.'

But turning an impoverished, looted colony into a tax-haven is no path to riches: instead, these treasure islands get stuck in a long period of stagnation (the 'finance curse') that prevents them from realizing their full potential. In the meantime, the looted trillions that they're skimming pennies from are the source of enormous suffering other countries (many of them also former colonies). All told, financial secrecy havens are depriving the world's governments of £500b every year.

The UK and its dependencies lead the pack, but the Netherlands, Luxembourg and Switzerland (the 'Axis of Avoidance') aren't far behind.

Alex Cobham, chief executive at the Tax Justice Network, described the hypocrisy of rich nations which enable tax avoidance as “sickening”.

“A handful of the richest countries have waged a world tax war so corrosive, they’ve broken down the global corporate tax system beyond repair,” Mr Cobham said.

“The UK, Netherlands, Switzerland and Luxembourg – the Axis of Avoidance – line their own pockets at the expense of a crucial funding stream for sustainable human progress.

“The ability of governments across the world to tax multinational corporations in order to pay teachers’ wages, build hospitals and ensure a level playing field for local businesses has been deliberately and ruthlessly undermined.”

UK by far the biggest enabler of global corporate tax dodging, groundbreaking research finds [Ben Chapman/The Independent]

(via /r/LateStageCapitalism/)